Electrovaya Enters into $1.5 Million Secured Loan Facility
14 August 2018 - 8:02AM
Electrovaya Inc. (“Electrovaya” or the “Company”) (TSX:EFL)
(OTCQX:EFLVF) announces that it has entered into a secured demand
loan facility with a corporation controlled by a director of the
Company. The loan facility is for the principal amount of
$1,500,000 with interest payable at 10% per annum accruing until a
demand for repayment is made or the facility is repaid in full, and
is evidenced by a promissory note in favour of the lender. The
Company’s obligations under the loan facility will be guaranteed by
Electrovaya Corp. and 1408871 Ontario Inc., subsidiaries of the
Company. The guarantee of 1408871 Ontario Inc. will be secured by a
fourth charge on the Company’s property at 2645 Royal Windsor Dr.,
Mississauga, Ontario, L5J 1K9. $500,000 was drawn on the
facility in advance.
The transaction is a “related party transaction”
for Electrovaya within the meaning of that term under Multilateral
Instrument 61-101 - Protection of Minority Security Holders in
Special Transactions (“MI 61-101”) as the lender
under the facility is controlled by a director of the Company. The
entering into of the loan facility is exempt from the formal
valuation and minority approval requirements under MI 61-101 as the
fair market value of the consideration for the transaction, insofar
as it involves interested parties, is not more than 25% of the
market capitalization of Electrovaya at the time the transaction
was agreed to. This news release is being issued less than 21 days
before the expected closing date of the loan facility. The Company
believes such completion is reasonable in the circumstances in
order to increase the Company’s working capital for the fulfilment
of customer purchase orders.
For more information, please
contact:
Peter KovenBay Street CommunicationsTelephone:
1.647.496.7857Email: peterkoven@baystreetcommunications.com
About Electrovaya
Inc.Electrovaya Inc. (TSX:EFL) (OTCQX:EFLVF) designs,
develops and manufactures proprietary Lithium Ion Super Polymer®
batteries, battery systems, and battery-related products for energy
storage, clean electric transportation and other specialized
applications. Headquartered in Ontario, Canada, Electrovaya is a
technology focused company with extensive IP, supplying leading
global customers.
To learn more about how Electrovaya is powering
mobility and energy storage, please explore
www.electrovaya.com.
Cautionary Note Regarding
Forward-Looking Statements
This press release contains forward-looking
statements, including statements that relate to, among other
things: the anticipated completion of the loan facility and the
timing thereof; the terms of the loan facility; and the Company’s
objectives, goals, strategies, intentions, beliefs, expectations
and estimates. Forward-looking statements can generally be
identified by the use of words such as “may”, “will”, “could”,
“should”, “would”, “likely”, "possible", “expect”, “intend”,
“estimate”, “anticipate”, “believe”, “plan”, “objective” and
“continue” (or the negative thereof) and words and expressions of
similar import. Although the Company believes that the expectations
reflected in such forward-looking statements are reasonable, such
statements involve risks and uncertainties, and undue reliance
should not be placed on such statements. Certain material factors
or assumptions are applied in making forward-looking statements,
and actual results may differ materially from those expressed or
implied in such statements. Material assumptions used to develop
forward-looking information in this news release include, among
other things, that the transaction will close on the expected terms
and in the expected timeframe, that current customers will continue
to make and increase orders for the Company’s products, that the
Company’s alternate supply chain will be adequate to replace
material supply and manufacturing, that the Company’s
interpretation of the effect of any comfort given to Litarion’s
auditors of the Company’s financial support for Litarion’s
operations is correct, and that Litarion’s insolvency process will
proceed in an orderly fashion that will satisfy Litarion’s debt
without a significant negative effect on the Company or its assets.
Important factors that could cause actual results to differ
materially from expectations include but are not limited to:
actions taken by creditors and remedies granted by German courts in
the Litarion insolvency proceedings and their effect on the
Company’s business and assets, negative reactions of the Company’s
existing customers to Litarion’s insolvency process, the ability to
sell the Company’s premises or to do so at a price reflecting
appropriate value, general business and economic conditions
(including but not limited to currency rates and creditworthiness
of customers); Company liquidity and capital resources, including
the availability of additional capital resources to fund its
activities; level of competition; changes in laws and regulations;
legal and regulatory proceedings; the ability to adapt products and
services to the changing market; the ability to attract and retain
key executives; and the ability to execute strategic plans.
Additional information about material factors that could cause
actual results to differ materially from expectations and about
material factors or assumptions applied in making forward-looking
statements may be found in the Company’s Annual Information Form
for the year ended September 30, 2017 and in the Company’s most
recent annual and interim Management’s Discussion and Analysis
under “Risk and Uncertainties” as well as in other public
disclosure documents filed with Canadian securities regulatory
authorities. The Company does not undertake any obligation to
update publicly or to revise any of the forward-looking statements
contained in this document, whether as a result of new information,
future events or otherwise, except as required by law.
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